WHEN IT COMES TO market forecasts, will you do better listening to your friends -- or to high-powered investment pros? Your friends. This year they are probably bullish.

Meir Statman, a finance professor at Santa Clara University, works with me on research that explores how investors behave. In one recent study we measured investors in three categories -- retail investors, newsletter writers and professional Wall Street strategists -- and compared their sentiments about market direction to later results.

Each of these groups is regularly wrong. But the very worst of them are the professional strategists, by far. For decades traders used odd-
lot statistics to bet against the sentiment of retail investors. They would have done better to bet against professionals.

Statman and I did not rate individual market seers; we lumped them all together. But there is no reason you cant pick out your own favorite experts to bet against. One of mine is the Barrons Roundtable, an annual talkfest by a roomful of Wall Streeters that appears in January and February. The repartee is entertaining but the sentiment is wrong. This year the pundits were quite bearish. So, as a contrary bettor, Im for a bullish stance on stocks for 1999.

Another great source is Merrill Lynchs compiled Wall Street Sell Side strategists indicator. Done monthly, it has a contrary and statistically significant result. Now the strategists are bearish. So be bullish. My firm compiles its own data on strategists. As 1999 began, only 14% of portfolio strategists foresaw an above-average year. Fully 86% envisioned a below-average or negative year. Again, be bullish.

Of course, there are also very few forecasters foreseeing a disaster year, so you must consider that possibility. But as I detailed in my May 4, 1998 column, it would be, in the light of history, extraordinary if 1999 were a negative year for the S&P 500. It doesnt ever fall in the third year of a Presidents term.

The Great Humiliator has only one goal: to humiliate as many people as possible for as many dollars as possible over as long a time as possible. En route its favorite victims are professionals. As a group they cant be right.

So, you should expect this to be an above-average year. My global total return allocation remains 100% equity with 67% of that in the U.S., and that solely from among Americas 25 largest stocks (see my Mar. 22 column for the list, available also at www.forbes.com/fisher).

The other 33% should be in good, big, foreign stocks with a concentration on continental Europe and a few Japanese global exporters.

Like:
ABN Amro (21, AAN, www.abnamro.com) is the Netherlands largest bank and a global force with 1,900 branches in 70 countries. Since most U.S.
bank stocks arent worthy now, foreign bank stocks are doubly precious.

ABN is strong in commercial banking, investment banking and money management. And it is cheap at less than 14 times trailing earnings, 2.1 times book value and 90% of annual revenue. It has a 3% dividend yield.

You can also bank on Spains Banco Bilbao Vizcaya (15, BBV, www.bbv.es). With 4,900 branches worldwide and $13 billion in revenue, it is the powerhouse of Spanish banking. Spain continues to develop the best of any European country -- economically, culturally and financially.

BBV also has a big share in Latin American banking, which right now penalizes the stock and creates an opportunity.

Buy ING Group (55, ING, www.ingroup. com), the worlds second-largest life and health insurer, after the AXA Group. INGs price/earnings multiple is 16 and its price/book is a mere 1.75 (compared with 33 times earnings and 6.6 times book for AXA-UAP).

Finally, Dutch-based Akzo Nobel (37, AKZOY, www.akzonobel.com) is the worlds largest paintmaker and a leader in chemicals and pharmaceuticals. Well managed, but with a lackluster growth history, Akzo is poorly regarded on Wall Street. It is cheap at 12 times trailing earnings, 85% of revenue and 2.3 times book value. It has a 2.4%
dividend yield. AKZOY is on Nasdaq -- as you can tell from the five letters in its ticker. Every foreign stock I mention is an ADR. Most Americans cant buy non-ADRs. Foreign stocks with fewer than four-letter tickers are on the Big Board.

Kenneth L. Fisher is a Woodside, Calif.-based money manager. His third book is 100 Minds that Made the Market. E-mail:kenfisher@fi.com

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